• Niall Kavanagh

CICA's impact on motor Insurance in Ireland

The Consumers Insurance Contracts Act 2019 (CICA) was introduced in Ireland to give consumers better rights and more protection when entering an insurance contract. Although only fully implemented in September 2021, it already has had a dramatic impact on insurers selling products to Irish consumers.

Similar to the Consumer Insurance (Disclosure and Representation) Act 2012 (CIDRA) in the UK, the act places new responsibilities on both the insurer and the insured in Ireland.

Insurers must now gather more information pre-contract and also disclose more information to the consumer. To ensure compliance with the act, insurers have spent a considerable amount of time over the last 2 years reviewing and modifying their application process and documents for consumer products.

Rather than just adding more questions, insurers have also taken the opportunity to remove questions that are no longer fit for purpose. With all these changes now in place for a number of months, we decided to take a look at how the act has impacted on the application process for Irish consumers with a particular focus on motor insurance.

We focussed only on the 'customer journey' for the top 8 motor insurers and top 3 digital brokers in Ireland. The summary findings are below. If you would like to get a free copy of the complete report with more detailed analysis then please contact us.

Length of Customer Journey

There is a large variance in the number of questions being asked to get a motor insurance quote and also the number of questions being asked after the quote to buy the policy.

The following numbers are based on certain assumptions* about the proposer.

  1. The lowest number of questions to get a motor quote is 22, the highest is 46

  2. There are between 1 and 19 further questions being asked after a quote to buy a policy

  3. The total number of questions asked when buying a motor policy varies from 31 to 55

Driver Number

More insurers are now asking for the driver number and 4 insurers require this information before the policy can be purchased. The driver number is being used to check in real time that the penalty points and No Claim Bonus (NCB) information is correct.

Two of the three digital brokers also request the driver number but it is optional and not required to buy motor insurance online.

Vehicle Details

Most of the vehicle technical information is coming from data enrichment companies like Verisk. However there are still some questions being asked that could possibly be sourced elsewhere. This includes;

  • If the vehicle is left or right hand drive (asked by 2 insurers)

  • The date of purchase of the vehicle (asked by 4 insurers)

  • If the vehicle has a valid NCT (asked by only 1 insurer)

  • Security Features of the vehicle (asked by only 1 insurer)

All insurers have removed questions about where the vehicle is mainly used but this question is still being asked by two of the three digital brokers.

Our analysis identified there are now 2 insurers who have removed the question on annual mileage from the quote process. This is hardly surprising since the figure is nearly impossible to verify and believed to be widely understated which raises the question of its value to the insurer.

Bundled and optional features

What were traditionally benefits bundled with the motor policy (windscreen cover, breakdown assistance etc.) are now being offered more regularly as optional extras.

We believe this trend is being driven by consumer demand for lower priced insurance and the ability to personalize the level of cover the individual wants.

The default excess for fully comprehensive policies range from €0 to €500 with the ability to adjust to other set amounts. Our analysis found that most insurers are offering a default excess of €250 or €300.

* Figures based on the following assumptions: (1) Irish resident with a full Irish driving licence, (2) Employed, (3) Have an existing insurance policy, (4) No previous claims, penalty points, convictions etc. (5) Do not want to add a driver.

About Gatepost

Gatepost provide a new way to collect verified information about the applicant and the insurable interest pre-quote.

Instead of using long application forms, our mobile-first technology captures the required risk and rating data from official documents the applicant possesses.

Our AI-driven solution helps prevents application fraud and shortens the customer journey by over 60%.

For more information, please contact us.